Firstly, wish everyone a very happy new year. May the new year 2021 be a lot better than the troublesome 2020 we just got rid of.
Historically, analysts see the Fashion and Lifestyle industry as being laggards when it comes to technology adoption. But the pandemic has definitely pushed the retailers to adapt & innovate or perish.
For the Fashion and Retail industry, 2021 will continue to be a defining moment to showcase resilience and adapt and enable future growth through innovation. It is indeed remarkable to see the resilient retail industry in a year of COVID which has managed to not just ‘not lose ground’ (based on projections of a decline of around 10% for the year as of June 2020), but turnaround and grow 0.8% YoY is incredible to say the least. The stimulus, lack of travel & activities and the rise in overall personal savings for consumers in 2020 helped redirect some of that spend to retail.
Retail’s non-decline notwithstanding, there definitely were a few losers and unfortunately Clothing sector had to deal with a dismal -27% decline in growth YoY due to the pandemic, though there were a few winners like Nike, Lulu, Crocs etc. Word on the street is that the retail pundits are forecasting a resurgence for clothing in 2021, but in my opinion, it might just take a couple of years before the apparel sector gets back its mojo.Looking forward to 2021, Retailers should continue to focus on the following areas:
1. Enterprise Improvement
- Retailers have and will continue to look at how they can increase profitability with the reduced top line growth (although the expectation is for overall retail to continue to grow at a conservative rate in 2021, hopefully with the pandemic behind us)
- Re-evaluate ‘Not For Resale Goods & Services’ and cost optimization strategies (Based on research, around 65% of the customers that have evaluated NFR goods and services in the past or are currently evaluating on a recurring basis have seen a profitability lift of at least 3%)
- Understand and invest in true Digital Transformation
- Digital is a way of functioning for companies. Enabling Data Driven decision making to add value in the current and for the future
2. Operational Excellence
- Enable Digital Ecosystems
- Create a Digital Mindset culture within the workforce along with agility, being nimble and adaptability
- Innovate toward Digital Supply Chain
- Invest and adopt Digital and Data Solutions
- Evaluate and implement the following technologies where applicable:
- AI/ ML
- Emerging Technologies like Blockchain
3. Customer Centricity
- Focus on ‘Customer as the channel’ moving away from siloed, legacy ways of working
- Improve and Invest on Omnichannel Capabilities
- Explore and build meaningful partnerships for last mile delivery
Here’s how Carhartt's early foray in to building a digital-core is facilitating its post-pandemic growth; one of the many initiatives of the company which contributed to John Hill, CIO of Carhartt to be awarded the prestigious ORBIE Award - Michigan CIO of the year.